Thailand improves in ease of doing business
In the World Bank’s International Finance Corporation (IFC) Doing Business 2015 survey, Thailand has increased its position from 28th place to 26th place according to the World Bank Country Director for South East Asia, Mr. Ulrich Zachau who is based in Bangkok.
In top position was Singapore, closely followed by Hong Kong, New Zealand and South Korea filling up the top four spots. Taiwan came in at 19th position whilst Malaysia was the fourth easiest place to do business in Asia.
- The data shows that many economies in the region made it easier for businesses to pay taxes in the past year, says Ulrich Zachau.
Vietnam reduced the corporate income tax rate. China enhanced its electronic filing and payment system – while also making business incorporation less expensive. Mongolia introduced a new electronic payment system. Such reforms are saving entrepreneurs valuable time.
In Mongolia, businesses were able to see a reduction in the number of hours for tax compliance to 148 hours, from 192 hours. The new stats were on a par with some European countries such as Austria.
Consistent regulatory reforms have improved the ease of doing business in the region in the past decade, and contributed to more business opportunities for local entrepreneurs.
Bank of Thailand might start stimulus
The Bank of Thailand (BOT) hinted at possible stimulus measures citing risks that the economy might fail to reach its 1.5 per cent growth target this year. Exports are also being closely watched as there is a possibility that there will be a contraction.
BOT Governor Prasarn Trairatvorakul says:
- We are watching closely. If economic growth continues at a low level, it may be necessary for additional monetary policy.
In its last meeting the bank's Monetary Policy Committee (MPC) left interest rates on hold at two per cent, even though it was concerned about the slow pace of economic expansion.
The bank of Thailand is trying to tread a fine line between fiscal constraint and the possible need for stimulus, noting that monetary measures were not necessarily a magic pill for all problems.
The MPC has already reduced interest rates three times since the second quarter of last year from 2.75 per cent to the current two per cent level. The rate cuts have helped businesses but there has been relatively little impact from the moves. A labor shortage is still an issue and being more accommodative in terms of monetary policy would like not change that situation.
Thailand has seen several uncertainties based on internal and external factors including the political impasse earlier in 2014, which served to drag the economy into a negative growth period, only to recover in the second half of this year. The overall net effect is a possible miss of the 1.5 per cent overall growth target for FY 2014.
Exports have been hard hit due to reduced market prices of staples such as rubber and rice. Electronic products also saw price reductions and there were structural problems for export. For the full year 2014 period, exports are still set to fall from the previous year.
As for tourism, due to a slowdown in Europe and conflicts in Russia the number of tourist arrivals to the Kingdom is expected to be 25 million people, falling short of the 27 million people target. Thus the country will be more reliant on domestic demand and consumption.
One of the things that the government is doing this year is to speed up approval for projects under the Board of Investment initiatives to help improve the economy.
Etihad 'Residence' suites a hit
A full hotel style suite aboard Etihad’s A380 super jumbo jet that costs up to US$20,000, (620,000 baht) has proved a hit with high flyers. The suite consists of three rooms - a living area, a double bedroom and an ensuite shower. It comes complete with a butler. The company reported that on its first 10 flights all suites had sold out, far exceeding the usual sales for first class booths, which stands at around a fifty per cent reservation rate.
Etihad chief executive officer, James Hogan, says:
- We've been quite happy with the take-up. There's a market there.
The first flight of the A380 will be between Abu Dhabi and London on 27th December. The Airline uses Abu Dhabi as its hub and is currently the third largest gulf based carrier. It hopes that the new offering of the “Residence” suite will help it to outperform its rivals such as Qatar Airways and Emirates. Both of these airlines have recently started flying the A380 but, even though Emirates is working to upgrade its first class offering, neither have yet to offer anything as glamorous as the fully integrated suite.
Etihad has ordered ten A380s and will deploy some on the London route whilst others will be used to fly to Sydney and New York. These significantly longer flights will be where the “Residence” suite will likely be all the more sought after. The London route is to become an all-A380 three times daily route.